Arab Finance: Egypt's vehicle production is expected to grow steadily in the coming years, but it may fall behind competitors in North Africa, according to a recent BMI report from Fitch Solutions.

The report projects that Egypt would produce 37,000 vehicles in 2024, placing it second spot in North Africa behind Morocco, which is expected to produce 614,000 vehicles, and ahead of Algeria, which is forecasted to produce 17,400 vehicles.

Despite this, Egypt's long-term growth is modest, the report said.

BMI forecasts an average annual growth rate of 11.4% in Egypt's vehicle production from 2024 to 2033, reaching just under 83,500 vehicles by the end of this period.

BMI attributes Egypt's relatively strong vehicle production in 2024 to anticipated foreign exchange stabilization and the easing of import restrictions, which should provide manufacturers with a more stable business environment.

The Egyptian government has been actively working to localize the auto industry, introducing the Egyptian Automotive Industry Development Program (AIDP) in 2022.

This program aims to offer incentives to auto manufacturers, enhance the country’s assembly and manufacturing capabilities, and attract new investments in the sector.

However, other North African markets are expected to outpace Egypt. Algeria, in particular, is forecasted to grow its vehicle production at an annual rate of 36.5% between 2025 and 2033, with an output of 236,700 units by the end of the period.

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